**2.5 Microfinance bank**

*Banking and Finance*

It is remarkable to note that in the last two decades, policies of government through the Central Bank of Nigeria have made bank services to have increased tremendously. For instance, the cashless policy of the Central Bank of Nigeria has eliminated some of the early challenges of banking services in Nigeria [1]. This brought about service availability, promoted service capacity in general and specific terms, and service delivery. But to observers, banking service delivery which is the extent to which the bank is able to meet with the banking service requests of customers (individuals or organisations) in the most efficient manner is below what is expected by customers. This chapter discuses salient issues to provide background

The banking system in Nigeria is structured along six layers, namely, central bank, deposit money banks, merchant banks, development finance institutions,

This is the apex monetary authority in Nigeria established by 1958 Act of CBN and started operations on July 1, 1959. At that time it was saddled with the responsibilities of enhancing the quality of banking operations in the country. To achieve this mandate, the bank has evolved different programmes such as industry remedial programmes, risk-based supervision, establishment of regulatory framework, customer protection and internal transformation of the bank activities. Among the functions of the bank are to serve as the banker to the government, act as a banker to all other types of banks, hold foreign reserve of the country, manage the national debt of the country, serve as a lender of last resort and control deposit money

This is a financial institution that is registered to render financial services to the general public such as accepting deposit, providing loans, keeping valuables and serving as financial advisers to customers, among others. Banks in this category are older than the emergence of the Nigerian State. Foremost was the Bank of British West Africa which was founded in 1894. It is on record that indigenous banking started in 1929 with the establishment of the industrial and deposit money bank by a group of Nigerian and Ghanaian entrepreneurs. After independence in 1960, the Bank of British West Africa became the first Nigeria-based bank which is now known as First Bank of Nigeria. Presently, there are 25 deposit money banks in

A merchant bank is a specialist financial bank that provides wholesale banking, medium- and long-term finance, equipment leasing, debt factoring investments management and so on. This type of bank evolves in Nigeria back in the 1960 with the establishment of NAL Merchant Bank Plc. Over the years, a number of mer-

knowledge on the subject before taking positions.

**2. Structure of banks in Nigeria**

**2.1 Central Bank of Nigeria**

**2.2 Deposit money banks**

**2.3 Merchant banks**

Nigeria as of October 2019 (www.cbn.gov.ng).

chant banks have been registered by the government.

microfinance bank, and mortgage banks.

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banks.

The Central Bank of Nigeria described microfinance bank as a financial institution at the grassroots level to perform basic banking services to the poor. This bank is different from conventional deposit money bank because of its ease of operations, absence of asset-based collateral and smallness of loans advanced and/or savings. The roles of microfinance bank are not limited to address banking shortfall at the grassroots and provide timely, reasonable, varied and reliable banking services to the poor. It is meant to provide financial service intervention for the low-income earners at lower echelon of the society.
